Official figures from the Office for National Statistics show that number of people in work has hit a new all-time. But the number of people out of work and claiming benefit also rose in February.
Over the three months to January, more than 57,000 people joined the workforce, taking employment to 27.82 million, its highest for 19 years. Over the same period the unemployment level fell by 73,000 to 1.46 million.
The rise in new claimants of 2,600 in February compares to an average monthly fall of 1,800 over the past six months and some analysts believe that the UK will now see unemployment increasing over the next few months.
The Office for National Statistics Labour Market Report also said that the increase in employment was entirely made up of full-time posts. Previous indications had been that most new jobs were poorly paid part-time roles.
Employment grew in every sector of the economy except manufacturing and transport over the three months to December. Financial and business services expanded by 13,000 while hotels and caterers took on an extra 28,000 people. But the largest increase was once again in the expanding public sector, which employed an additional 37,000 people.
Joe Slavin, managing director of recruitment website Monster.co.uk, said that recruitment in many sectors was booming. "We've seen a surge in hiring activity in areas such as sales, information technology and administrative services," he said.
Earnings appear to be stagnating, however. Growth in average earnings fell by 0.1 per cent over the last quarter to 3.6 per cent. Public sector pay rose by 5 per cent while private sector earnings growth slowed to 3.2 per cent.